Updated October 16, 2026. Quick answer: Louisiana excludes $12,000 of pension and annuity income for people “received by an individual sixty-five years of age or older”, and the documents read do not name 403(b) or 457(b) plans.
More state retirement-income schedules, line by line: Louisiana retirement income exemption.
Louisiana at a glance
| Item | What the documents say |
|---|---|
| How the state treats 403(b) and 457(b) withdrawals | The documents read do not say whether these plans qualify |
| Do the state’s documents name these plans? | The documents read name neither 403(b) nor 457(b) plans |
| Retirement exclusion or credit | Annual retirement income exclusion of $12,000 at 65 or older, adjusted annually from January 1, 2026 |
| Public-employee pension rule | Yes, benefits from listed state and local retirement systems are excluded separately |
| Rate in the documents read | Flat 3% |
| Changed for 2026? | The $12,000 amount is adjusted annually beginning January 1, 2026 |
What the Louisiana documents say
Louisiana’s statute, R.S. 47:44.1, limits the exclusion to pension and annuity income and says the dollar amount “shall be adjusted annually beginning January 1, 2026”. The Department’s FAQ lists the state and local retirement systems whose benefits are excluded separately; the list names public systems and not 403(b) or 457(b) plans.
The Department’s rates FAQ says that for taxable periods beginning on or after January 1, 2025, “the individual income tax rate is a flat 3%”.
Withholding and federal tax
Whether a state withholds is a separate rule: see state withholding on retirement withdrawals. Federal rules: 403(b) withdrawal rules and 457(b) withdrawal rules. The IRS says that if you receive pension or annuity payments from a qualified employer retirement plan, “all or some portion of the amounts you receive may be taxable unless the payment is a qualified distribution from a designated Roth account”.
What the documents do not say
- The documents read do not name 403(b) or 457(b) plans.
- Whether a distribution from one counts as pension and annuity income for the $12,000 exclusion is not stated.
Common mistakes
- Assuming Louisiana’s rule for a 401(k) or IRA also covers a 403(b) or 457(b): read whether its documents name the plan.
Related: whether Louisiana taxes 401(k) and IRA withdrawals, Louisiana retirement taxes, whether Louisiana taxes pensions, 403(b) withdrawal rules, 457(b) withdrawal rules, and state withholding on retirement withdrawals.
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Answer againSources
- Is there a list of retirement system benefits that may be excluded from Louisiana income tax? (FAQ): https://revenue.louisiana.gov/tax-education-and-faqs/faqs/individual-income-tax/is-there-a-list-of-retirement-system-benefits-that-may-be-excluded-from-louisiana-income-tax/
- La. R.S. 47:44.1 Annual retirement or disability income; exemption from taxation: https://legis.la.gov/legis/Law.aspx?d=102133
- What are the individual income tax rates and brackets? (FAQ): https://revenue.louisiana.gov/tax-education-and-faqs/faqs/income-tax-reform/what-are-the-individual-income-tax-rates-and-brackets/
- IRS Tax Topic 410, Pensions and annuities: https://www.irs.gov/taxtopics/tc410
Sources: the primary documents linked above, read on October 16, 2026. General information, not tax advice. Your own facts decide the outcome, and a tax professional or the state agency itself is the right place to confirm anything consequential.